Philip Hammond has been criticised for suggesting that more disabled people finding jobs is partly responsible for UK’s falling productivity.

Appearing in front of the Treasury Select Committee, the Chancellor said: “It is almost certainly the case that by increasing participation in the workforce, including far higher levels of participation by marginal groups and very high levels of engagement in the workforce, for example of disabled people - something we should be extremely proud of - may have had an impact on overall productivity measurements.”

He was responding to a question about a 0.1 per cent fall in UK productivity earlier this year.

Opposition MPs describe his comments as ”appalling” and “ignorant”, while disability charities called them “shocking” as they accused Mr Hammond of perpetuating “outdated negative stereotypes”.

Labour’s John Mann, who sits on the committee, wrote on Twitter: “Appalling. Chancellor just linked low productivity growth to the labour market and specified the increased employment of disabled people.

“My experience of employing disabled people is that they are brilliant employees. The chancellors [sic] comments are ignorant.”

Appalling. Chancellor just linked low productivity growth to the labour market and specified the increased employment of disabled people.

Mr Hammond said having more people from “all groups in society” in jobs was beneficial in other ways, even if it reduces productivity.

“Having high levels of workforce participation, and allowing maximum access to the workforce for all groups in society brings benefits in itself, and actually produces larger GDP," he said. "It may have collateral impact on measured productivity performance.”

However, disability charities said the Chancellor’s comments were “shocking” and “outdated”.

Richard Kramer, deputy chief executive of Sense, said: “It is shocking to hear the Chancellor’s comments today, blaming Britain’s fall in economic productivity on working disabled people. Just last week the Government renewed its commitment to increase the amount of disabled people in work, recognising the important role that meaningful employment plays for disabled people and wider society.

“Philip Hammond’s comments undermine these ambitions completely and many disabled workers will be appalled at such outdated negative stereotypes being reinforced by the Chancellor.”